Under the partnership, the two Silicon Valley companies plan to collaborate in development of multi-chip packages to house flash memories sand the baseband processor in a "system-in-a-package." The chip interfaces and new packages will boost CDMA handset performance and lower power consumption for a range of advanced wireless applications, said AMD and LSI Logic managers.

"Next-generation mobile terminals will require an optimized interface between the flash memory and the baseband processor to harness wireless broadband capabilities," said Walid Maghribi, group vice president of AMD's Memory Group in Sunnyvale.

According to Dataquest Inc., the worldwide shipments of CDMA-based handsets will total 68 million cellular handsets this year and grow to 264 million units by 2003. New-generation handsets are expected to take on a growing number of features and functions for increased broadband capabilities needed in video streaming, Internet audio and other advanced applications.

LSI Logic intends to leverage AMD's expertise in flash memory technology to increase the performance of its baseband processors, said John Daane, executive vice president of the Fremont company's Communications Products Group. Daane also suggested that the collaboration could lead to product solutions for other markets outside of the wireless handset segment.